Asian currencies held steady against the US dollar Tuesday as markets awaited the Federal Reserve's first policy decision under Chairman Kevin Warsh's leadership. The consolidation reflects investor caution ahead of what could be a defining moment for the central bank's direction, with trading ranges tightening across major regional pairs.

Warsh enters the spotlight with his 'AI-is-disinflationary' thesis and questions swirling about his alignment with President Trump's agenda. Westpac Strategy Group's Richard Franulovich notes uncertainty around whether Warsh favors a trimmed CPI target, leaving traders guessing about his stance on the hawk-dove spectrum. This ambiguity creates the risk of a more measured tone than markets currently expect.

The dollar edged up 0.1% to 1,510.60 won against the South Korean currency, while holding flat at 1.2816 Singapore dollars. The Australian dollar barely budged at US$0.7068, according to LSEG data, as investors keep powder dry ahead of the policy announcement.

The positioning suggests markets are braced for potential volatility once Warsh's true colors emerge on monetary policy. His academic background and previous writings on technology's deflationary effects could mark a departure from recent Fed orthodoxy, making this decision particularly consequential for global currency markets.